Capella Sales & Servs. Ltd. v. United States

Decision Date20 July 2016
Docket NumberCourt No. 14-00304,Slip Op. 16-72
Citation180 F.Supp.3d 1293
CourtU.S. Court of International Trade
Parties Capella Sales & Services Ltd., Plaintiff, v. United States, Defendant.

Irene H. Chen , Chen Law Group LLC, of Rockville, MD, and Mark B. Lehnardt , Lehnardt & Lehnardt LLC, of Liberty, MO, for the Plaintiff.

Aimee Lee , Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of New York, NY, for the Defendant. Also on the brief were Benjamin C. Mizer , Principal Deputy Assistant Attorney General, Jeanne E. Davidson , Director, and Reginald T. Blades , Assistant Director. Of counsel were Jessica M. Link , Attorney, Office of the Chief Counsel for Trade Enforcement & Compliance, U.S. Department of Commerce, of Washington, DC, and Edward N. Mauer , Office of Assistant Chief Counsel, International Trade Litigation, U.S. Customs & Border Protection, of New York, NY.

OPINION

Pogue

, Senior Judge:

In this action, Plaintiff Capella Sales & Services Ltd. (Plaintiff or “Capella”)1 challenges the assessment of countervailing duties (“CVD”), at the rate of 374.15 percent ad valorem, on four of its entries of aluminum extrusions from the PRC. The U.S. Department of Commerce (Defendant or “Commerce”) assessed these duties by applying the all-others rate calculated in Aluminum Extrusions from the [PRC], 76 Fed. Reg. 18,521 (Dep't Commerce Apr. 4, 2011)

(final affirmative countervailing duty determination) (Final CVD Determination). In levying such duties, Commerce did not impose the (lower) “lawful [all-others] rate” calculated subsequently on remand and redetermination following litigation of the Final CVD Determination by parties other than Capella.2 Am. Compl., ECF No. 32-1, at ¶¶ 50, 52.

Defendant moves to dismiss this action pursuant to USCIT Rule 12(b)(1)

for lack of subject matter jurisdiction or, in the alternative, pursuant to USCIT Rule 12(b)(6) for failure to state a claim upon which relief can be granted. Def.'s Mot. to Dismiss & Mot. for Summ. J., ECF No. 40 (“Def.'s Br.”).3

Because Capella's complaint challenges Commerce's administration and enforcement of a CVD rate, the court has jurisdiction under 28 U.S.C. § 1581(i) (2012)

. However, because Plaintiff did not participate in, and have liquidation of its entries enjoined pursuant to, the litigation that resulted in the “lawful rate” calculated on remand and redetermination, it cannot claim entitlement to that rate. See 19 U.S.C. §§ 1516a(c)(1), 1516a(e) (2012) ; Am. Compl., ECF No. 32-1, at ¶¶ 7, 10. Plaintiff has, therefore, failed to state a claim upon which relief can be granted. USCIT Rule 12(b)(6). Accordingly, Defendant's motion to dismiss under USCIT Rule 12(b)(6) is granted.

BACKGROUND

This case arises from Commerce's CVD investigation of aluminum extrusions from the PRC. Aluminum Extrusions from the [PRC], 75 Fed. Reg. 22,114 (Dep't Commerce Apr. 27, 2010)

(initiation of countervailing duty investigation).4 After investigation and comment, Commerce made a final affirmative finding and calculated an all-others rate of 374.15 percent ad valorem. Final CVD Determination, 76 Fed. Reg. at 18,523.

Following the International Trade Commission's final affirmative finding of injury, Commerce issued a CVD order on aluminum extrusions from the PRC. Aluminum Extrusions from the [PRC], 76 Fed. Reg. 30,653 (Dep't Commerce May 26, 2011)

(countervailing duty order) (CVD Order). Pursuant to this Order, Commerce instructed U.S. Customs and Border Protection (“Customs” or “CBP”) to collect cash deposits for non-individually investigated companies at the all-others rate of 374.15 percent ad valorem (the investigation rate). Id. at 30,655.

On June 23, 2011, the plaintiffs in MacLean-Fogg v. United States, Consol. Ct. No. 11-00209, challenged Commerce's Final CVD Determination pursuant to 19 U.S.C. §§ 1516a(a)(2)(A)(i)(II)

, 1516a(a)(2)(B)(i).5 The ensuing litigation generated two redeterminations from Commerce6 and four opinions from this Court7 —the last one affirming Commerce's calculation of an 137.65 percent ad valorem all-others rate, MacLean – Fogg Co. v. United States, 885 F.Supp.2d at 1339. This Court's fourth opinion was appealed to the Court of Appeals for the Federal Circuit (“CAFC”), which reversed and remanded.8 The CAFC's decision was followed by two more redeterminations by Commerce9 and three additional opinions from this Court10 —the last, issued on October 23, 2015, affirming Commerce's final redetermination. The final, redetermined all-others rate was 7.37 percent ad valorem (the post-MacLean-Fogg rate). [Fourth] Results of Redetermination Pursuant to Ct. Remand, Consol. Ct. 11-209, ECF Nos. 124-1 (conf. ver.) & 125-1 (pub. ver.).

While the MacLean-Fogg litigation was proceeding, Commerce, on May 1, 2012, published notice of the opportunity for interested parties to request administrative review of the CVD Order for entries made between September 7, 2010 and December 31, 2011 (the first period of review). Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 77 Fed. Reg. 25,679, 25,680 (Dep't Commerce May 1, 2012)

(AR1 Opportunity). Commerce indicated that, absent a timely request for review, it would instruct Customs to assess countervailing duties “on those entries [for which review was not requested] at a rate equal to the cash deposit of (or bond for) estimated [ ] countervailing duties required ... at the time of entry, or withdrawal from warehouse, for consumption....” Id. at 25,681. Commerce subsequently initiated the first administrative review. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 77 Fed. Reg. 40,565, 40,572 (Dep't Commerce July 10, 2012) (AR1 Initiation). Commerce then issued automatic liquidation instructions for subject entries made during the period of review but for which administrative review had not been requested. CBP Message No. 2209305 (July 27, 2012), reproduced in Compl., ECF No. 2-1 at attach. 6.

On December 14, 2012, following this Court's affirmance of Commerce's [Second] Results of Redetermination Pursuant to Court Remand, Consol. Ct. No. 11-209, ECF No. 80-1, see MacLean – Fogg, 885 F.Supp.2d at 1339

, but prior to the appeal of the that decision to the CAFC, see Notice of Appeal (Jan. 28, 2013), Consol. Ct. No. 11-209, ECF No. 89, Commerce issued a Timken Notice11 giving effect to the [Second] Results of Redetermination Pursuant to Ct. Remand, Consol. Ct. No. 11-209, ECF No. 80-1, as affirmed in MacLean – Fogg, 885 F.Supp.2d 1337. The Timken Notice set the all others cash deposit rate, as it was then calculated pursuant to the litigation, at 137.65 percent ad valorem with an effective date of December 10, 2012. Timken Notice, 77 Fed. Reg. at 74,466, 74,466 -67. Commerce then instructed Customs to require, for “all others,” “a cash deposit equal to the rate” of 137.65 percent ad valorem for “shipments of aluminum extrusions from the [PRC] entered, or withdrawn from warehouse, for consumption on or after December 10, 2012.” CBP Message No. 2355304 (Dec. 20, 2012), reproduced in Compl., ECF No. 2-1 at attach. 8.

While the MacLean-Fogg litigation was still proceeding, on May 1, 2013, Commerce published notice of the opportunity for interested parties to request administrative review of the CVD Order for entries made between January 1, 2012 and December 31, 2012 (the second period of review). Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Administrative Review, 78 Fed. Reg. 25,423, 25,424 (Dep't Commerce May 1, 2013)

(AR2 Opportunity). Commerce again indicated that, absent a timely request for review, it would instruct Customs to assess countervailing duties “on those entries at a rate equal to the cash deposit of (or bond for) estimated [countervailing duties] required ... at the time of entry, or withdrawal from warehouse, for consumption and to continue to collect the cash deposit previously ordered.” Id. at 25,425. Commerce subsequently initiated the second administrative review. Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 78 Fed. Reg. 38,924, 38,935 (Dep't Commerce June 28, 2013) (AR2 Initiation). Commerce then issued automatic liquidation instructions for subject entries made during the period of review for which administrative review had not been requested. CBP Message No. 3197305 (July 16, 2013), reproduced in Compl., ECF No. 2-1 at attach. 10.

Meanwhile, seemingly unaware of the various administrative proceedings and litigation surrounding aluminum extrusion from the PRC, Capella made four entries of subject merchandise—two on November 28, 2011, during the first period of review, and two, on March 20 and June 16, 2012, during the second period of review. Am. Compl., ECF No. 32-1, at ¶ 7; CF-7501's, reproduced in Compl., ECF No. 2-1 at attach. 5; Protest, 4601-14-101149 (July 14, 2014), reproduced in Compl., ECF No. 2-1 at attach. 15. Capella mistakenly entered its merchandise as Type 01 (i.e., not subject to AD or CVD duties) rather than Type 03 (i.e., subject to AD or CVD duties). Am. Compl., ECF No. 32-1, at ¶¶ 7, 10.12

Capella did not participate in the investigation or the appeal of the CVD Order. Am. Compl., ECF No. 32-1, at ¶ 7 (“Capella was unaware of the CVD Order.”). Nor did Capella participate in the first administrative review of that Order. Id. at ¶ 10 ([Capella] was not aware of,” the review and therefore “did not know to request a review”). And, despite having received, months prior to Commerce's notice of opportunity to request review, direct notice from Customs that its four entries were properly classified as Type 03 and subject to the CVD Order, id. at ¶ 1513 ; see AR2 Opportunity, 78 Fed. Reg. 25,423 (published May 1, 2013)

, Capella did not participate in the second administrative review of...

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